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Why cashless retail isn’t ready for primetime

Formerly cashless retailers like Amazon Go are now required to accept cash. Here’s why and what to tell your customers.

July 22, 2019

The idea of walking into a retailer or grab-and-go-style restaurant, doing your shopping and paying electronically without interacting with a human is appealing to many. In Amazon Go’s case, a combination of an app on your phone and on-site video cameras log what items you place into your bag and you’re electronically debited once you leave the store.

Amazon wasn’t the first to roll out such a concept, but it certainly earned the most publicity. Naturally, other retailers and restaurants have followed suit. Unfortunately, in the time since cashless operations have been gaining prominence, there’s been some backlash.

The argument against cashless stores is that they discriminate against millions of low-income and unbanked citizens; according to FDIC data, at least 8.4 million households (or 6.5% of the country) currently do not have a checking or savings account.. Philadelphia and New Jersey recently passed bans on cashless stores. San Francisco, New York City and Washington are expected to follow suit. In addition, regardless of whether someone is low-income or lacks a bank account, sometimes it’s simply preferable to pay with cash.

Prompted by these events, Amazon Go is taking steps to retrofit stores to accept traditional payment options. Last month, a senior reporter at Gizmodo shared his experience trying to pay cash at Amazon Go. Spoiler: the transaction wasn’t very customer-friendly. 
 
If the rest of the industry is true to form, we should see other cashless operations backtrack and accept traditional payments. We can also expect new concepts to remain cash-friendly upon launch.
Now that we’ve watched this unfold, there are some clear lessons for solution providers as you interact with your customers.

What to tell your customers about the cashless retail and payment trend
  • Cashless POS could alienate some customers and could negatively impact sales. It might be illegal in your city/state.
  • The best POS solution will include a mix of mobile POS devices and fixed or hybrid (i.e., can be fixed or mobile) POS terminals that enable you to engage with customers anywhere in the store.
  • Accept multiple forms of payment. This includes cash, credit/debit cards and mobile wallets such as Apple Pay, Google Pay, Samsung Pay, etc.
  • Cashless retailing is something to monitor. Leaders like Amazon are always innovating and finding new ways to make shopping easier. There will be lessons to learn, no matter the size of the retailer.
There could be a day when all retail is, indeed, cashless. When that happens, you can rest assured that Ingram Micro will provide you with all the technology you need to leverage the opportunity. In the meantime, Ingram Micro offers a broad line card to address all your customers’ current POS and payment technology needs. For more information on how you can use technology to help your customers compete with companies like Amazon, contact Ingram Micro’s POS expert Daryl Schuster.